Kontoor Brands Q2 revenue up 25 percent, lowers FY outlook
Kontoor Brands, the owner of denim labels Wrangler and Lee, has reported a 25 percent increase in revenue in the second quarter of the year.
In the three months to July 2, revenue came in at 613.6 million dollars, compared to 490.8 million dollars a year earlier.
That growth was primarily driven by the company's US business, which saw a 40 percent increase in revenue to 510.2 million dollars.
On a less bright note, international revenue was down 18 percent to 103.3 million dollars, with China dropping 50 percent due to ongoing Covid-19 restrictions.
Breaking it down by brand, revenue at Wrangler grew 34 percent to 417.9 million dollars, while revenue at Lee grew 10 percent to 193.1 million dollars.
Net income was 62 million dollars, up from 23.6 million dollars a year earlier.
Kontoor Brands CEO and chair Scott Baxter told investors: “In a highly dynamic macroeconomic environment, supply chain challenges and inflationary pressures accelerated during the quarter.”
He said these macro conditions “will remain challenging, particularly as retailer inventories are rebalanced and inflation weighs on overall consumer demand”.
Based on those challenges, Kontoor Brands has lowered its full-year outlook. It now expects year-over-year revenue growth of approximately 6 percent, compared to its previous estimate of around 10 percent.
It expects adjusted earnings per share to be between 4.40 dollars and 4.50 dollars, compared to prior guidance of 4.75 dollars to 4.85 dollars.